Employers Pull Back on Posting New Jobs
17 January 2020 - 6:51PM
Dow Jones News
By Sarah Chaney
WASHINGTON -- Job openings declined sharply in November, a sign
of weakening employer demand that could restrain job growth in
2020.
Job openings fell 10.8% in November from a year earlier to 6.8
million, the Labor Department said Friday. That marked the sixth
straight month of annual declines and was the steepest fall since
December 2009, when openings dropped 18.7% from a year earlier.
"Pullback in employer demand is leading to a leveling off of
momentum in the labor market and also in the bargaining power for
job seekers," Nick Bunker, economist at Indeed, said.
Separate economic data on industrial production and housing
starts released Friday shed light on other parts of the U.S.
economy affected by unseasonably warm weather.
Job openings peaked at 7.6 million in November 2018 and have
declined about 800,000 since then. They remain elevated compared
with pre-2018 years. Many businesses cite widespread labor
shortages as a factor holding back job growth, according to the
Federal's "beige book," a collection of anecdotal reports from
businesses around the country.
The job market broadly remains in solid shape. Openings
continued to run higher than the number of unemployed workers for
the 21st straight month in November. Further, the U.S. labor market
is still adding jobs at a steady pace and the unemployment rate is
at a half-century low of 3.5%. One missing piece has been wages,
which grew 2.9% in December from a year earlier, the smallest gain
since July 2018.
Still, economists surveyed by The Wall Street Journal expect
payroll gains to slow in 2020 as the pace of hiring eases.
Economists expect monthly nonfarm-payroll gains to average 116,650
in the fourth quarter of 2020, down from the fourth quarter of
2019.
The rate at which workers are quitting their jobs isn't budging,
a possible explanation for sluggish pay growth. Workers tend to
command higher pay when they move from one job to another. The
so-called quits rate logged in at 2.3% in November for the ninth
time in 2019.
In 2019, the U.S. labor market was a source of strength while
manufacturing activity at home and abroad faltered.
In December, there were signs of reversal in the goods-producing
sector. Manufacturing output crept up, according to a Federal
Reserve report. That could reflect early reaction to the agreement
between U.S. and Chinese officials to the first phase of a trade
deal, a truce in a dispute that weighed on global manufacturing for
much of last year.
Separately, utilities production declined by 5.6% because of
lower demand for heating due to unseasonably warm December weather,
the Federal Reserve said.
Mild winter weather also helped boost housing starts in
December, analysts noted. U.S. housing starts increased to a
seasonally adjusted annual rate of 1.608 million in December, the
highest level since December 2006, Friday's Commerce Department
report showed.
Starts have increased the past three months, suggesting
historically low mortgage rates coupled with a favorable U.S.
economy are supporting the U.S. housing market.
Write to Sarah Chaney at sarah.chaney@wsj.com
(END) Dow Jones Newswires
January 17, 2020 13:36 ET (18:36 GMT)
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